Chapter five

This chapter is repeating to talk that companies will practice more conservative spending because they overbuy. For example, It is amazing that buyers who initially purchased software at a 50% discount price but they have the maintenance costs of 40% or more every year after on the software’s list price. Thus, we can see that there are a lot of hidden costs which the companies did not predict. However, I think that this situation can be improved. When the companies purchase a new technology, they have to pay attention for negotiating contracts. Another thing is that some companies buy the new software without comparing it to needed level of use within its organization. For example, the company just cut the cost of the new technology but they did not know what level of use of the technology is within the organization. The book has already showed us that the company can save 5 million dollars by cutting down the number of licenses purchased. Thus, I hope that the company has to pay some attention for what level of use of the technology is within the organization.
In conclusion, I agree that IT spending will decrease as companies as technology bills and budgets are being scrutinized. Uncertainty of the future causes concern for consumers who spend less in general. This is likely to spill over into business and IT spending. I also suggest that companies should evaluate their projects when they pay attention to their current technology assets. Thus, the companies are learning how to get more than their assets. I think that this part is very important for the companies.